Apple: Forget SuperCycle, Let's Talk "Super Long Cycle"
RBC notes the supply chain stocks and AAPL (to a lesser extent) have witnessed some pressure recently on news reports that iPhone 8 sales have been soft and there are component supply constraints that could mean that AAPL would have insufficient iPhone X units available in the initial months. Firm thinks the bull case on AAPL is more powerful today vs. 90-days ago as we morph from a "supercycle" (20%+ unit growth) thesis to a "super-long" cycle where units/revs/EPS should growth double digit in FY18 and FY19. Fundamentally, they think AAPL should remain ontrack to achieve >$11 EPS in FY18 and potentially >$12 EPS in FY19 driven by -- Higher ASP's, Higher Gross-margins but lower units (vs. buyside expectations 90-days ago). They think the "super-long" cycle scenario is more attractive as it enables a longer, extended cycle that dampens the general seasonality seen with iPhones as iPhone X drives sales into Mar and Jun quarter. Firm thinks iPhone X will generate solid demand and sales/GM tailwind despite some initial hiccups.